Right, because of your kernel has been updated (Fri 07 Mar 2008 11:38:10 AM EET kernel-2.6.24.3-12.fc8).
Your graphical card driver should be too.
Try following command to check if the corresponding module has well been loaded (it might have not):

It seems there is no intel module loaded for graphical card (there is only for sound).
So, either you must install the module (may be something like xorg-x11-drv-i810 or another iXXX), either it can not be loaded.
For the last case, check the output of dmesg or /var/log/messages.

How does one enable Direct Rendering? I have read every entry on every forum that Google returns, even for other distros, but no one seems to ever say quite how to enable it. I have tried everything that has been posted that makes some sense. I suspect Desktop Effects is failing because Direct Rendering is not enabled. Is it a complicated procedure to enable it?

I didn't try desktop effects on the -12 kernel, but I upgraded to the -22 kernel in updates-testing as that fixed my problems with wep-authentication on wlan. My laptop has intel graphics, and I have done nothing to install special drivers for it. Just what comes with F8. I can confirm that desktop effects work here on the -22 kernel, but I have disabled them again as I get a complete lock-up when doing fast user switching with desktop effects enabled.

I didn't try desktop effects on the -12 kernel, but I upgraded to the -22 kernel in updates-testing as that fixed my problems with wep-authentication on wlan. My laptop has intel graphics, and I have done nothing to install special drivers for it. Just what comes with F8. I can confirm that desktop effects work here on the -22 kernel, but I have disabled them again as I get a complete lock-up when doing fast user switching with desktop effects enabled.

This lock-up with fast user switching and compiz has been an issue for a while ( you need to stop compiz before switching user ).